The candy bar at the bottom of the pyramid

July 6, 2010

Last week, Nestle, the world’s largest food company, launched a barge called Nestlé Até Você a Bordo – or Nestlé Takes You Onboard – on an 18-day voyage up the Amazon River in Brazil. This so-called floating supermarket will bring more than 300 well-known Nestlé brands, including Ninho (packaged milk), Maggi (soups and seasonings) and Nescafé (instant coffee) to 800,000 potential customers in 18 cities who, who, until now, managed to get by without those products, or such treats as Nestle’s Crunch, Push-Up or my childhood favorite, Baby Ruth.

In a press release, Ivan Zurita, the chief executive of Nestlé Brazil, is quoted as saying:

It will be a service to the population of the Amazon, who has streets and avenues in the form of rivers. It is a project aligned with our concept of Regionalisation, based on the different profiles of consumers, where we deal with each region as a different area.

I don’t think these people are lost or have been camping out too long, they’re just living their lives. They probably don’t even realize they are missing out on Toll House, Raisinets, and Sno-Caps. But no matter, if there are people out there so backwards to still be subsisting on food found in nature, Big Food will find them, by land or by sea, and set them straight.

Neat! It’s like having an ice cream truck come to your house, which must be especially exciting when your house is in a remote fishing city in Brazil.

This is the kind of argument we’ll be hearing more often, as growth slows in the U.S., EU and Japan and global companies seek new customers in Brazil, China, India and the rest of the developing world. In particular, companies are looking for ways to reconfigure their products and services to appeal to the world’s two billion poor people. That opportunity was the focus of The Fortune at the Bottom of the Pyramid, an influential book by C.K. Prahalad, who died earlier this year. The book’s subtitle, by the way, was “eradicating poverty through profits.”

As it happens, Nestle provided a case study of how not to sell to the poor back in the 1970s when it became the target of a worldwide boycott over what critics said was its unethical marketing of infant formula. This time around, Nestle is emphasizing the nutritional value of its food; by email, Luciane Gellerman of Nestle Brazil tells me that the products on the barge include

Ninho Integral Milk (that) contains ingredients that are essential to children during growth, such as vitamins A and D, plus calcium, phosphorus, magnesium, carbohydrates and proteins….It is the only line of milks with specific benefits to meet the needs of each child’s stage of growth. Its consumption should be associated with a balanced diet and healthy lifestyle….Ideal, a line that consists of dairy products enriched with iron, calcium and Vitamins A, C and D…Both products are supplied in packaging sachets, which reduces the final price.

In the news release announcing the barge, Nestle also makes a point of saying that it employs about 7,500 resellers in Brazil, most of them urban women, who go door-to-door, selling Nestle products. These women “become in some cases the main source of funds to their families,” the company says.

Of course, Nestle is providing more than fortified milk and sales jobs to the Brazilian poor–it is also introducing them to such treats as the Nestle Drumstick, “the original sundae cone,” (290 calories, 16 grams of fat) and, by extension, the fat-heavy, sugar-infused diet that has contributed to the obesity epidemic here in the United States.

And yet…to argue that Nestle should stay out of the Amazon or sell only healthy products there is to say that we know better than the Brazilians what’s good for them. (Presumably, they are already getting plenty of fresh, locally grown vegetables.) People found it heartwarming when when American GIs handed out candy bars to impoverished kids in Europe after World War II. The Chinese love Kentucky Fried Chicken. MTV is a hit in India. And a trilogy of Swedish thrillers dominates the best-seller list in the U.S.

Maybe we should celebrate the fact that kids in the Amazon can now enjoy a Nestle Drumstick on a hot and humid day.